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M1 is a useful tool to understand why the prices of consumer goods have increased but not at all useful to understand home buying power. People regularly sell
by nwiswell 4y ago
M1 is a useful tool to understand why the prices of consumer goods have increased but not at all useful to understand home buying power.
People regularly sell stocks, bonds, and other homes in order to produce the down payment for a mortgage and have done so since long before 2020. M1 does not measure any of these.
- majormajor 4y agoThe set of homebuyers and the set of stimulus recipients in a lot of these markets are non-overlapping, too. Crypto, on the other hand, is something I know was sold for a downpayment by several of my acquaintances, which is acting as its own form of "money supply increase" since they spent orders of magnitude less to acquire it. The anti-inflation tool creates its own inflation by turning into "new money." :)